U-Turn For Capital Economics Now Forecasting Big Price Rises...

Date Published 21 October 2013

Capital Economics – the one that always forecasts the end of the world and house prices dropping through the hatch – has cheered up.

We are not sure whether this is more alarming than its normal despondency – a bit like Norman Bates giving a reassuring smile just as you`re thinking of taking a shower.

However, in January, the think tank forecast a 5% drop in house prices this year, while a few months ago it predicted a further 3% fall next year.

Doom, doom and thrice doom.

However, it now forecasts a 6% rise this year, and a 5% house price rise next year and also the year after.

The reason? Capital Economics does not think much of Help to Buy and that the result will be prices heading ever upwards.